Nikkei falls over 4% as selling of tech issues continues
Baku, June 8, AZERTAC
Tokyo stocks plunged on Monday, with the Nikkei stock index shedding more than 4 percent at one point, as investors sought to lock in gains from recent sharp rises in heavyweight technology shares, according to Kyodo.
The 225-issue Nikkei Stock Average ended down 2,563.52 points, or 3.85 percent, from Friday at 64,024.60. The broader Topix index finished 96.71 points, or 2.45 percent, lower at 3,852.38.
On the top-tier Prime Market, the main decliners were nonferrous metal, electric appliance and glass and ceramics product issues.
The U.S. dollar traded narrowly in the lower 160 yen range in Tokyo, supported by speculation of a rate hike by the Federal Reserve, while wariness over potential currency intervention by the Japanese authorities kept its upside limited.
At 5 p.m., the dollar fetched 160.22-23 yen compared with 160.28-38 yen in New York and 159.94-96 yen in Tokyo at 5 p.m. Friday.
The euro was quoted at $1.1516-1517 and 184.52-56 yen against $1.1518-1528 and 184.57-67 yen in New York and $1.1632-1633 and 186.05-09 yen in Tokyo late Friday afternoon.
The yield on the benchmark 10-year Japanese government bond was up 0.050 percentage point from Friday's close at 2.715 percent, following a rise in U.S. Treasury yields. Reports of Iran and Israel trading attacks also prompted bond selling on worries of further inflation brought by rising crude oil prices.
Artificial intelligence- and semiconductor-related shares led the decline as profit-taking was triggered by losses in their U.S. counterparts.
Investor sentiment was also dampened by rising uncertainty over the Middle East situation, following reports of new strikes by Israel, Iran and Iran-backed Lebanese militant group Hezbollah over the weekend.
Although the benchmark Nikkei index recorded its fourth-largest intraday point drop in history, growth hopes for the technology sector remain intact, analysts said.
"Demand for semiconductor-related stocks is likely to remain strong, so what we are seeing now appears to be a temporary pullback following the recent surge," said Maki Sawada, strategist in the Investment Content Department of Nomura Securities Co.
Toshikazu Horiuchi, equity strategist at IwaiCosmo Securities Co., also said, "Corporate earnings are keeping pace with the rally, so once overheating concerns subside, the market could have further room to advance."
Other news in this section
